Learning Outcomes: By exploring the application of business forecasts you will gain an understanding of the value of forecasting in a business environment. Preparing a forecast will provide you with the skills to apply quantitative and qualitative forecasting techniques when required for business decision making. The analysis of a volume of actual data will require application of a spreadsheet, supporting the value of software programs in facilitating the use of time series data. Research using the internet will increase your knowledge of data availability for use in business forecasting.
Task: use the data on the following table from the ABS to complete this task
1. Forecast total apparent consumption (‘000) Litres for 1) white wine 2) Red wine, and 3) Total wine, in terms of volume of beverage for 2006 - 2015. Prepare line graphs for each forecast and the actuals on the same axes.
2. Forecast per capita consumption (litres) for Total wine by volume 2006 - 2015. Prepare a line graph for this forecast and the actuals on the same axes.
3. Explain by whom and for what purpose the forecasts would be used. Provide examples of decisions that would be made based on the forecasts, including the consequences of incorrect decisions.
4. Based on the uses and consequences, determine an acceptable level of accuracy for the forecasts.
5. Use graphing software to calculate the Centred Moving Average (CMA) for the total apparent consumption. Prepare a line graph showing actual data and CMA on the same graph.
6. Observe the data and graph for trends, cycles or irregularities. Include details of your observations in your report.
7. Combine your observations with research on such factors as the future of the economy, the industry and any other variables that you think may be relevant in predicting a combined trend/cycle growth % for 2015. Make sure your research is appropriate for the wine industry. Report your prediction, including a summary of your findings and assumptions to justify your prediction.
8. Compare your forecast with actual results from the data and calculate the MAPE. Comment on the accuracy of your forecast comparing it with your acceptable level of accuracy determined earlier. Explain how you could have produced a more accurate result, think of different methods or different assumptions that may have worked better and whether the actual results have been affected by any unusual factors or incidences.